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Supplier Data

Bad supplier data can be at the root of many finances and accounts payable challenges.

There are many ways vendor data can be processed that cause duplicate vendor files to be set up.

From inconsistent naming conventions to the same vendors located at different addresses, the risk of Supplier Data errors are vast, and the impact of this bad data can be dramatic.

Based on a research report by Jason Busch and Thomas Kase of Spend Matters, here are the top seven areas to focus on to avoid the costly impact of bad supplier data:

1) Create a single undisputed point of supplier data reference – With processes to automate the vendor registration process, to collect supplier communications in a shared repository and to assure data entry accuracy, organizations and dramatically eliminate costly errors.

2)Adhere to data compliance requirements – Technology solutions can build in flexibility to support new compliance requirements by dynamically engaging with vendors around business changes, reducing compliance turnaround.

3)Assure data security and privacy – In partnership with the Information Technology organization, Finance, and A/P need to have strong adherence to security and privacy governance for data security, IP protection, and information privacy.

4)Eliminate payment errors – A focus on processes to remove payment errors will reduce expenses around reissuing checks, late payment penalties and reduce overpayments and duplicate payments which can occur whenever a vendor is set up twice in the system.

5)Establish business continuity dependencies – Often owned by the Procurement team, business continuity impacts areas including material costs such as wrong parts, the cost of product or service disruption when stock runs out, operational overhead. It is also important to evaluate sales-side impact before making buys-side decisions, especially if a vendor is also a customer.

7) Automate using technology – Investments in technology will significantly improve your overall ROI as well as improve a company’s procurement efficient utilization that can result in substantial savings.